LG Energy Solution (XKRX:373220) Inventory Turnover : 1.14 (As of Dec. 2023)

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What is LG Energy Solution Inventory Turnover?

Inventory Turnover measures how fast the company turns over its inventory within a year. It is calculated as Cost of Goods Sold divided by Total Inventories. LG Energy Solution's Cost of Goods Sold for the three months ended in Dec. 2023 was ₩7,028,146 Mil. LG Energy Solution's Average Total Inventories for the quarter that ended in Dec. 2023 was ₩6,170,378 Mil. LG Energy Solution's Inventory Turnover for the quarter that ended in Dec. 2023 was 1.14.

Days Inventory indicates the number of days of goods in sales that a company has in the inventory. LG Energy Solution's Days Inventory for the three months ended in Dec. 2023 was 80.11.

Inventory-to-Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue. LG Energy Solution's Inventory-to-Revenue for the quarter that ended in Dec. 2023 was 0.77.

LG Energy Solution Inventory Turnover Historical Data

The historical data trend for LG Energy Solution's Inventory Turnover can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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LG Energy Solution Inventory Turnover Chart

LG Energy Solution Annual Data

Trend

Dec20

Dec21

Dec22

Dec23

Inventory Turnover

0.41

4.02

3.91

4.65

LG Energy Solution Quarterly Data
	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Inventory Turnover	Get a 7-Day Free Trial							0.97	1.03	1.01	0.97	1.14

LG Energy Solution Inventory Turnover Calculation

LG Energy Solution's Inventory Turnover for the fiscal year that ended in Dec. 2023 is calculated as

	Inventory Turnover (A: Dec. 2023 )
=	Cost of Goods Sold	/	Average Total Inventories
=	Cost of Goods Sold (A: Dec. 2023 )	/ (	(Total Inventories (A: Dec. 2022 )	+	Total Inventories (A: Dec. 2023 ))	/	count )
=	28802437	/ (	(6995629	+	5396336)	/	2 )
=	28802437	/	6195982.5
=	4.65

LG Energy Solution's Inventory Turnover for the quarter that ended in Dec. 2023 is calculated as

	Inventory Turnover (Q: Dec. 2023 )
=	Cost of Goods Sold	/	Average Total Inventories
=	Cost of Goods Sold (Q: Dec. 2023 )	/ (	(Total Inventories (Q: Sep. 2023 )	+	Total Inventories (Q: Dec. 2023 ))	/	count )
=	7028146	/ (	(6944420	+	5396336)	/	2 )
=	7028146	/	6170378
=	1.14

LG Energy Solution (XKRX:373220) Inventory Turnover Explanation

Inventory Turnover measures how fast the company turns over its inventory within a year. A higher Inventory Turnover means the company has light inventory. Therefore the company spends less money on storage, write downs, and obsolete inventory. If the inventory is too light, it may affect sales because the company may not have enough to meet demand.

1. Days Inventory indicates the number of days of goods in sales that a company has in the inventory.

LG Energy Solution's Days Inventory for the three months ended in Dec. 2023 is calculated as:

Days Inventory	=	Average Total Inventories (Q: Dec. 2023 )	/	Cost of Goods Sold (Q: Dec. 2023 )	*	Days in Period
	=	6170378	/	7028146	*	365 / 4
	=	80.11

2. Inventory-to-Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue.

LG Energy Solution's Inventory to Revenue for the quarter that ended in Dec. 2023 is calculated as

Inventory-to-Revenue	=	Average Total Inventories (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	6170378	/	8001324
	=	0.77

Be Aware

Usually retailers pile up their inventories at holiday seasons to meet the stronger demand. Therefore, the inventory of a particular quarter of a year should not be used to calculate Inventory Turnover. An average inventory is a better indication.

LG Energy Solution Inventory Turnover Related Terms

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LG Energy Solution (XKRX:373220) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Products » LG Energy Solution Ltd (XKRX:373220) » Definitions » Inventory Turnover

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Traded in Other Exchanges

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Address

Yeongdeungpo-gu, Yeoui-daero, Seoul, KOR

Website

https://www.lgensol.com

LG Energy Solution, or LGES, is the third-largest battery maker for electric vehicles, or EVs, with about 14% global share in the first half of 2023, according to SNE Research. The EV battery segment is the largest revenue contributor, which accounted for close to 60% of total revenue in 2022. Besides EV batteries, LGES also manufactures batteries for mobility, mobile phones, laptops, electrical devices, and energy storage systems. The company was spun off from LG Chem's battery division in December 2020 and listed on the Korea Exchange in January 2022. It has global manufacturing facilities in Korea, China, Poland and the United States. Key customers include General Motors, Tesla, Volkswagen, Hyundai Motors and Stellantis.

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